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Monday, March 19, 2012

IBJ Glorifies Rise Of Ersal Ozdemir

Those of us who believe in honest, transparent government which is neutral when it comes to the success or failure of those in private business want to puke when we read stories like the one that appeared in the latest edition of the IBJ, which glorifies the rise of Ersal Ozdemir, a Turkish immigrant and U.S. citizen only since 1999, as "one of the city's most powerful developers." The article titled, "A bid deal in a hurry," has a smiling Ozdemir pictured in front of Carmel's $60 million Sophia Square, financed in part, thanks to a contribution of $13 million from Carmel's taxpayers after Ozdemir showered Carmel Mayor James Brainard, like other politicians who dole out taxpayer dollars to his private developments, with campaign contributions. Cory Schouten's story opens:

Ersal Ozdemir seems to have vaulted, pretty much overnight, from a rising star in Indianapolis real estate to a powerhouse developer.

The 37-year-old Turkish immigrant is a civil engineer by training, a builder and developer by profession. He's smart, creative, earnest and he works 12-hour days.

But competitors wondering how he has come so far so fast shouldn't underestimate a few of Ozdemir's other talents: as a salesman and schmoozer with a knack for building profitable relationships with politicians . . .

"A knack for building profitable relationships with politicians?" I'd say. That's an understatement to say the least. In addition to the $13 million gift Brainard gave him courtesy of Carmel taxpayers for his Sophia Square project, Mayor Greg Ballard gave Ozdemir $6.35 million, or nearly one-third of the upfront payment the city of Indianapolis got from its badly-negotiated 50-year lease of the city's parking meter assets with ACS. Months after announcing the multi-million dollar gift to Ozdemir, who had showered Ballard's campaign committee with tens of thousands of dollars in campaign contributions over a several year period, took a junket with him to Europe and provided office space for his re-election campaign, we learned that the parking meter deal was generating less than half what had been promised and the city's honestly balanced budget is at least $50 million in the hole. We also learned that Ozdemir's parking garage to help ease the parking shortage problem in Broad Ripple was simply a ruse to allow Ozdemir to develop more than 10,000 square feet of new retail/commercial space that will consume most of the parking in the city-financed garage that will be owned entirely by Ozdemir and will share no revenues with the city.

Ballard's generosity towards Ozdemir with your tax dollars hasn't ended there. Ozdemir will control purse strings for the new CityWay project, which has taxpayers on the hook for more than $100 million for a mixed use project that Eli Lilly wanted but no bank would finance because the risk of failure is so high. And the diversion of your tax dollars to Ozdemir's personal wallet is far from over. Ozdemir hired Mayor Ballard's former chief of staff, Paul Okeson, to help raid taxpayer dollars for his benefit. Deputy Mayor Mike Huber unabashedly admits the mayor and his top staff meet regularly with Ozdemir. "He has built up a reputation for being willing to take risks," Huber said. Hah! Yeah, take risks with your tax dollars for his personal benefit. "The bottom line is he just goes for it," Huber added. Huber insults our intelligence by claiming the city isn't "playing favorites" in the awarding of these deals. "Our goal is a competitive and transparent process," he claims. Schouten notes that Ozdemir was on hand at Ballard's re-election victory party to be among the first to congratulate him on his win. "One could argue [Ozdemir] had as much to celebrate as the mayor," Schouten writes. No kidding.

The perception of Ozdemir in Indianapolis is strikingly similar to the reputation Tony Rezko built up in Chicago by schmoozing Chicago politicians like Rod Blagojevich and Barack Obama after immigrating to the U.S. from Syria before his big downfall. Like Ozdemir, Rezko started out working as a civil engineer. As Rezko told Chicago Magazine, "I met with people who were running for office, some elected, some not. I always worked with people I developed chemistry with. People I liked, they liked me, so we developed a relationship." Rezko helped Obama land his first job out of law school at a Chicago law firm where Obama did work for his company. "Rezko threw an early fundraiser for Obama at his North Shore house, and that fundraiser was instrumental in providing Obama with seed money for his U.S. Senate race in 2004," Chicago Magazine wrote. Rezko donated hundreds of thousands to the campaigns of various Chicago politicians and quickly rose to become one of Chicago's biggest real estate developers thanks to generous taxpayer financing of his projects. The last I checked he was sitting in a jail cell facing a lengthy prison sentence, along with one of his chief benefactors, former Illinois Gov. Rod Blagojevich. Rezko received a prison sentence of 10 1/2 years for the kickbacks he made to Illinois politicians in a scheme the federal judge described as "selfish and corrupt."

The funny part of the story is how Ozdemir boasts that his mentor is Beurt SerVaas. That would be the same former City-County Council President, OSS officer and CIA contractor who mentored his former son-in-law, Tim Durham, to the top of the Indianapolis business community. Durham showered Indiana politicians with nearly $1 million in campaign contributions before the feds finally caught up with the Ponzi schemer and charged him with bilking rural Ohio investors out of more than $200 million. And who took over as finance chairman of the Marion Co. Republican Party when Durham stepped down? You knew it. Ozdemir.

I'm not quite sure what to make of the claim in Schouten's story by Ozdemir that he's never missed a loan payment. Maybe he's made all of his payments to the bank, but I'm not sure that's comforting to all of his subcontractors or the insurance company that issued him a performance bond for work his Aymir Construction Corp. performed on several public construction projects. A 2010 court decision in the federal district court for the Southern District Court of Indiana found the company owned by Ozdemir and his former wife liable to U.S. Fidelity and Guaranty Company for more than $1.2 million the bond company had to pay to subcontractors for work Aymir failed to pay them for their work on three public library projects that had been awarded to Ozdemir's company. Those projects included the Irvington branch library in Indianapolis, Kokomo South Branch library and Tippecanoe Public Library. The court granted summary judgment in favor of the bond company after Aymir defaulted on the contracts and the bond company had to pay the claims of the subcontractors and hire new contractors to complete the unfinished work. I guess we're only talking about Ozdemir's Keystone Construction Corp. in the IBJ story.

"He's a great American story, " Brainard told Schouten about Ozdemir. I'll have to hand it to him. Immigrants like Ozdemir are quick studies of the weaknesses and shortcomings of our political system. They learn quickly that "pay to play" is the way to get ahead and get ahead they do. They learn that MBE certification allows the politicians to discriminate against long-established local companies which can't claim to be minority-owned so the politicians can boast that they are helping out minorities when nothing of the sort is actually occurring. Whatever works. Merit and sweat equity are so passe in America today if you hadn't figured that out yet.

2 comments:

It's interesting you talk about this level of corruption when the Center for Public Integrity just issued a report of all 50 states with grades on ethics/corruption. Indiana scored a C-, which I would argue is too high of a grade since we have an Inspector General's office that can't move without Governor Daniels' say-so and public records request laws that are so weak (with a crony public access counselor also appointed by the governor) that records can be withheld with all the time that should see the light of day. Here's Indiana's report -- what they do talk about is pretty good, I thought:

It is longstanding knowledge that the IBJ favors specific individuals or companies and slants articles accordingly. Please note the advertisement efforts being paid from Keystone Construction to the IBJ. Hmmm... Is this how criminals get nice articles written about themselves?

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